Question

Select the most appropriate alternative from those given below and rewrite the statement.

A partner who provides only capital to the firm is called as__________________.
a) active
b) nominal
c) sleeping
d) minor

Answer 1

A partner who provides only capital to the firm is called as sleeping partner.
Explanation: A partner who just provides capital to the firm and does not take active part in day-to-day functioning of the business is a sleeping partner. But he is liable to the third parties for the dues of the firm.